Australia has long used preferential voting systems at a Federal level and uses various forms of ranked voting for almost all elections, but such preferential voting was only introduced for federal elections in 1918. Between the founding of the Federal Commonwealth in 1901 and the 1919 Federal Election I presume a FPTP system was used, as results from those years do appear to have elected candidates for two parties only.
Why and how was it introduced? From what I remember reading, it was the rise of the Country Party, a party representing small farmers. It began splitting the anti-Labor vote in conservative rural areas. Which permitted progressive Labor candidates to win seats with a minority vote. In response, a conservative federal government introduced preferential voting as a way to permit competition between the two conservative parties without putting seats at risk of going to the other side of politics.
Could this happen in contemporary times in certain other countries? It doesn’t feel impossible.
Edit:
Perhaps I was too focused on trying to answer the author's question itself while avoiding delving into the specifics and background of two decades of chaotic early-Commonwealth of Australia politics. To elaborate, for anyone interested in details:
The first three Australian federal elections (1901, 1903, 1906) resulted in resulted in a spectacularly unstable multi-party system of minority governments with hung parliaments and uncooperative minor parties. One might not-unfairly dismiss entirely the first decade of Australian politics as "teething pains":
- As user103496 commented, this was not a two-party system. However, it was also not a functional multi-party system, in the sense that the Westminster parliamentary system ideally forms stable governments that will at least function until the next election.
- Normally, in multi-party systems, alliances and coalitions see one group or faction gather a mandate to form stable government. This was something that the (mostly) FPTP electoral system of the day permitted, and it was a Westminster parliamentary system which permits minority government.
- These three elections saw eight Prime Ministers in nine years.
- In the 1901 election, New South Wales, Victoria, South Australia, Western Australia used First past the post voting systems; Queensland used the Contingent vote system (IRV), Tasmania used the Hare-clark system (STV).
- Federation was scheduled for 1 January 1901. The first election was scheduled for March 1901. Whoops. So the first Governor General, having arrived from Britain about two weeks prior to Federation, initially tried to appoint as an interim caretaker Prime Minister a politician who had strongly opposed Federation, because precedents.
- Governments were formed by shifting coalitions which didn't often endure.
- This chaotic environment saw the world's first socialist or social-democrat party at a national-level (the 1904 Watson government)…
- …not by election, because Watson's Labour Party had the third largest result with 23 seats, but because Labour withdrew support from Deakin's Protectionist Party (26 seats) and Reid's Free Trade Party (25 seats) declined the position, so the Governor General just ran down the list to Watson…
- …though he wasn't aware that Watson wasn't even eligible for election to the Parliament because he wasn't a British citizen…
- …and Watson naturally lacked any sort of alliance or coalition to actually get anything passed, and he resigned after only 4 months.
- But shortly thereafter Labour had their own majority after the 1910 election
So yes, I tend to dismiss the first three elections as just signs of the bizarre political climate where norms hadn't yet quite been established. Yet out of that very unstable era things settled down into a two-party system at the Federal level along a (socialist/anti-socialist spectrum) for over a decade:
- The Fusion of the Protectionist Party and Anti-Socialist Party set up a two-party system which would have been reassuringly familiar to politicians who largely still identified as British more than Australian.
- Of the elections in 1910, 1913, 1914, and 1917, seats went almost entirely to the Labour/Labor Party or the conservative party opposing them (Commonwealth Liberal Party and then Nationalist Party).
- In this decade, only two elections saw a Lower House seat go to others: George Wise won as an independent in 1914, and Frederick Francis as an "independent Nationalist" in 1919. And none at all in the Senate.
- So this was a very solid, stable 2-party system.
- Until the rise of the Country Party threatened to split the vote away from the conservative Nationalist party. Farmers' organisations resolved to run candidates of their own in opposition to the Nationalist Party.
- The seat of Swan in Western Australia had been a Nationalist seat for years, safely held by Sir John Forrest who had won with large proportions of the (FPTP) vote: 60.2% (10.2% margin) in 1910, 54.9% (4.9% margin) in 1913, 59.2% (9.2% margin) in 1914, and run unopposed in 1917. And then passed away from cancer.
- The Swan by-election in October 1918 after Forrest's death saw a Labour candidate elected with just 34.4% of the vote, after the Nationalist candidate (29.6%) split the vote with the candidate from the Country Party of Western Australia (31.4%).
- Which was enough for Billy Hughes's political instincts to push for the Commonwealth Electoral Act 1918, which replaced the previous first-past-the-post system used in the House of Representatives with IRV (Instant-Runoff Voting), which is perhaps better known as preferential voting in Australia, ranked-choice voting (RCV) in the US, or Alternative Vote in the UK. The Act was then amended in 1919 to also allow preferential voting for the Senate. (Though it wouldn't be until 1948 that proportional representation (STV) was introduced for the Senate)
- The Labor Party initially opposed the introduction of preferential voting in this political environment.
So my thesis that is that:
- the first years of Australian national politics after Federation were amazingly wild and should be entirely disregarded as outliers
- Australia then settled into a comfortable and stable two-party Federal system
- threatening a political party with political purgatory by demonstrably splitting their vote and threatening to consign them to imminent political purgatory, has worked in Australia to motivate them to pass legislation to ditch FPTP electoral systems for more representative systems (though not the most representative system)
- But the Country Party had to be entirely ready to follow through and seize votes for themselves
Probably beyond the scope of the question (and my answer):
- the degree of popular support for more representative voting systems
- use of preferential and/or proportional representation in Australia at a State level which exposed voters to such systems
- the importance of Compulsory Voting, later introduced by the Commonwealth Electoral Act 1924
- the sometimes extreme diversity of minority parties elected to The Australian Senate under STV
- the role of the Australian Democrats
- the role of the Australian Greens
- the impacts on, or results of, later elections involving such third/fourth or more minor parties
- while Australia still has a political landscape of essentially two main factions, the requirement for parliamentary coalition, and the possibility of minority parties being required for support in a hung parliament, has resulted in a more diverse political environment than simply two parties would permit
